Reddit is seeking a valuation of up to $6.5 billion in its upcoming IPO, according to a person familiar with the matter.
The company plans to price its IPO between $31 to $34 a share, the person said. The Wall Street Journal was first to report on the expected range and valuation.
Reddit filed to go public in February and plans to trade on the New York Stock Exchange under ticker symbol RDDT.
Employees will be allowed to sell Reddit stock during the offering, the source added. Reddit had a private market valuation of $10 billion when it last raised a funding round of $1.3 billion in 2021, according to PitchBook.
At the top of the range, Sam Altman’s shares in the company would be worth over $400 million, considering the OpenAI CEO has invested at least $60 million in Reddit shares.
Other notable shareholders include Tencent and Advance Magazine Publishers, which is the parent company of publishing giant Condé Nast. A year after tech entrepreneurs Alexis Ohanian and Steve Huffman founded Reddit, Condé Nast bought the company and then spun it out in 2011.
In 2021, Reddit filed a confidential draft of its public offering prospectus with the Securities and Exchange Commission.
The company brought in $804 million in annual revenue for 2023, representing a 20% year-over-year increase from $666.7 million, according to its latest IPO prospectus. The company brought in $804 million in annual revenue for 2023, representing a 20% year-over-year increase from $666.7 million. Its net loss narrowed to $90.8 million for 2023 from $158.6 million the year prior.
Reddit’s non-employed forum moderators, known as Redditors, can participate in the upcoming IPO through the company’s “directed share program,” the filing said.
The social messaging company’s upcoming Wall Street debut comes amid a general cool down for IPOs, due in part to interest rate concerns and global economic uncertainty. When Reddit goes public, it will represent the first major tech IPO of the year and the first social media IPO since Pinterest’s Wall Street debut in 2019.
John Tuttle, the vice-chair of the New York Stock Exchange, said in an interview in January that the IPO market should lift in 2024, stating at the time, “We have a robust pipeline from across sectors and geographies.”
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